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TMI Blog1983 (12) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... ght or interest of the assessee in any policy of insurance before the moneys covered by the policies become due and payable to the assessee. On such amounts wealth-tax shall not be payable and the assets will also not be included in the net wealth of the assessee. The proviso to clause (vi) was introduced with effect from 1-4-1975. It is laid down in this proviso that in the case of a policy of insurance where the premium or other payment is payable during a period of less than ten years, the amount that shall not be included in the net wealth of the assessee under clause (vi) shall be a sum that bears to the value of the right or interest of the assessee in the policy the same proportion as the number of years during which the premium or o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by him earlier, the provision withdrawing the exemption in respect of the insurance policy could not be operative for this assessment year and, therefore, deleted the value of the annuities. 3. It is submitted on behalf of the revenue that in respect of taxing statutes, the law as it stands on the first day of the assessment year should govern the assessment for that assessment year. It is submitted that this position has been laid down in a number of decisions. It is pointed out that the proviso to clause (vi) of sub-section (1) of section 5 had been introduced with effect from 1-4-1975 and, therefore, it would govern the assessment for the assessment year 1975-76. It is pointed out that the decision of the Supreme Court in Smt. R.A. Mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The proviso that comes into force from 1-4-1975 cannot remove that right of the assessee. 5. On a careful consideration of the submissions, we are of the opinion that the assessment to wealth-tax is to be governed by the law as it stands on the first day of the assessment year. That it is the law on the first day of the assessment year that would govern an assessment has been laid down by the Supreme Court in Karimtharuvi Tea Estate Ltd. v. State of Kerala [1966] 60 ITR 262. It has been held in this decision that the Income-tax Act, 1961 ('the 1961 Act') as it stands amended on the first day of April of any financial year, must apply to the assessment of that year, that any amendments in the 1961 Act which come into force after the first d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the appeals relating to that assessment year were pending must give effect to the amended law though enacted after the close of the assessment year. Vide S.C. Prashar v. Vasantasen Dwarkadas [1963] 49 ITR 1 (SC). The aforesaid principles made applicable to income-tax assessments must be applied to the wealth-tax assessments also.... " 6. The learned counsel for the assessee has brought to our notice the observations of the Supreme Court in H.H. Setu Parvati Bayi's case at page 866. In this case, the question was regarding the allowability of the deduction in this context that the liability to wealth-tax crystallised on the valuation date. The Supreme Court in this connection had referred to its earlier decision in the case of Kesoram Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X
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